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Five Lessons from China’s Remarkable Post-COVID-19 Rebound By ASHLEY GALINA DUDARENOK
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hina was one of the first countries to contain the COVID-19 epidemic with relative success, and the economy is better for it. The National Statistics Bureau reported 4.9% growth in China’s Q3 GDP year-on-year, showing improvement against both its 3.2% growth in Q2, and 6.8% Q1 decline. This impressive rebound has earned China the title of the only major economy likely to advance in 2020, according to the International Monetary Fund (IMF). The results stand in sharp contrast to most of the world’s nations, which are struggling to juggle pandemic control and economic growth.
The five foundations that made China’s impressive rebound possible 1. Controlling the spread
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he Chinese government saw controlling the spread of the virus as its utmost priority. While there were initial oversights and misjudgments in the early days of the pandemic, authorities soon implemented strict controls and preventive measures to contain it. The initial clamp down on the spread of the pandemic ultimately made the economic rebound possible.
2. Coming together
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strong sense of unity in society helped to rebuild and reinforce China’s domestic business ecosystem. The central government created a conducive environment by lowering taxes and offering subsidies to certain industries. Industries started adopting policies such as employee sharing schemes to provide more employment opportunities, and local communities and Internet giants alike donated supplies and money to pandemic relief. Consumers were motivated to support local businesses with government-issued coupons, a trend which lasted post-pandemic. 22
Jumpstart Magazine
Spring 2020
3. Staying agile and adapting fast
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hriving businesses stayed agile and adopted new business models as the pandemic progressed. For instance, some hotels started an additional business line by selling cookies when travel was not possible and room occupancy rates were suffering. Restaurants explored selling ready-to-cook ingredient packs when dine-in wasn’t possible. 4. Embracing digital all the way
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s soon as the pandemic hit China, the pace of digitalization accelerated, and the switch to the digital consumption of all services was smooth and natural.
While digitalization may be happening everywhere, China offers a fuller immersion. Citizens can use Taobao to book a medical consultation. There are holographic projections of singers in bars. And these aren’t big-city phenomena: we can see the application of livestreaming and online payments even in wet markets. 5. Reimagining new consumption scenarios
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hanks to the quick restoration of consumer confidence, multiple new consumption scenarios, such as home entertainment and community retail, have been generated. Community retail isn’t new–it started back in 2018. Sellers post information about new arrivals in a WeChat group, and a community can elect to purchase the products together. One community retail platform, Shixianghui, covered 60 communities in Wuhan before the outbreak, but reached 6,000 communities at the peak of the pandemic. Alibaba’s Freshippo, JD.com’s 7 Fresh, and even luxury brands have now adopted this business model.